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Cable Industry Faces a la Carte Proposal

Jun 7, 2006  •  Post A Comment

Sen. John McCain, R-Ariz., introduced legislation Wednesday that encourages the cable TV industry and other video service providers to offer programming a la carte.

Under the measure, video service providers that offer a la carte to their own subscribers — and permit programming they own to be offered a la carte by independently owned distributors — would be rewarded with substantial deregulation.

In addition, the legislation would punish broadcast companies that don’t permit cable TV programming they own to be offered a la carte. A la carte programming would allow subscribers to choose and pay for only the programming they want.

Cable TV operators that go along would be rewarded by being allowed to switch to a new national franchising system that would allow them to escape key obligations they currently face under existing franchise agreements with local governmental authorities.

Broadcast owners of cable TV programming that decline to play ball would lose their current legal protection of the exclusivity of their network-affiliated programming in their communities.

If approved, the legislation would be a particularly severe blow to major broadcast TV networks that have substantial interests in cable programming networks, including The Walt Disney Co.’s ABC, NBC Universal and Fox.

If networks don’t agree to the a la carte stipulations, cable TV operators in communities in which the networks own television stations would be free to bring in the signals of independently owned stations affiliated with the same networks.

In a statement, the watchdog Consumers Union, a longtime proponent of a la carte, said it does not endorse Sen. McCain’s measure because “it goes too far in eliminating important public obligations of video service providers to ensure nondiscriminatory delivery of cable service, diversity of local programming and essential consumer protections, including the timely and successful resolution of consumer complaints.”